Australia’s Assistant Treasurer, Nick Sherry, has announced that Australia and Chile have signed a comprehensive bilateral double taxation agreement (DTA) – the second such agreement between Australia and a South American country.
The signing of the DTA had been delayed due to the earthquake in Chile on February 27, and the Australian government thanked the Chilean government and its officials for being able to bring the agreement to a conclusion in difficult circumstances.
"The new income tax treaty between Australia and Chile will provide certainty and stability of tax treatment for Australian and Chilean cross-border investors and reduce tax-related barriers so the economic relationship between our countries can continue to grow," Sherry said.
"Chile is a major destination for Australian investment, especially in the mining sector. The signing of this historic tax treaty is a great step forward for Australian businesses,” he continued. “It will help maintain the integrity of Australia's tax base by allowing the exchange of taxpayer information, including bank information, between Australian and Chilean tax administrators."
The provisions of the new DTA with Chile will also include reductions in source-country withholding taxes on certain cross-border payments of dividends, interest and royalties; and rules to determine when an enterprise or an individual of one country may be taxed on its activities abroad. There will be an agreed basis for determining the allocation of profits within a multinational company to reflect the transfer pricing that would be adopted by independent parties.
There will be a general obligation for both countries to relieve double taxation on cross-border income by permitting tax paid under the other country's laws, and in accordance with the DTA, to be allowed as a credit against tax payable under their own laws. Special rules will preserve the application of existing tax arrangements between Chile and Australian companies under the provisions of Chilean legislation. This is of particular importance to Australian mining companies with investments in Chile.
Legislation to give the new treaty the force of law will be introduced into the Australian and Chilean parliaments as soon as is practicable, Sherry informed.A comprehensive report in our Intelligence Report series, examining in depth the situation of offshore transparency and secrecy in a number of the most prominent jurisdictions, is available in the Lowtax Library at http://www.lowtaxlibrary.com/asp/subs_reports.asp and a description of the report can be seen at http://www.lowtaxlibrary.com/asp/description_report2.asp
The UAE's Cabinet on June 13, 2018, approved DTAs signed with Saudi Arabia, Rwanda, and Turkmenistan.
A law to ratify the Azerbaijan-Morocco DTA was tabled before Morocco's Cabinet on June 14, 2018.
Qatar's Government on June 14, 2018, confirmed that it had completed its domestic ratification procedures in respect of a DTA signed with Argentina.
Ukraine's Cabinet on June 6, 2018, approved a law to ratify a DTA Protocol signed with the United Kingdom.
Luxembourg and Vietnam agreed to continue negotiations towards a DTA Protocol at a June 15 meeting.
Sweden's Parliament on June 7, 2018, approved an amendment to the country's DTA with Switzerland to clarify the scope of the term pension fund in the agreement.
Switzerland's lower house of Parliament on May 29, 2018, approved DTAs with Kosovo and Pakistan.
The Moroccan Government has approved for ratification a DTA with the Republic of the Congo, it announced on May 29, 2018.
Argentina has approved a protocol to its DTA with Brazil, the Argentinian Official Gazette reported on May 23, 2018.
Brazil's upper house of Parliament on May 30, 2018, approved a protocol updating the DTA with Norway.
Hong Kong and Finland on May 24, 2018, signed a DTA.
Legislation ratifying a new DTA between Russia and Japan was submitted to the Russian State Assembly (the Duma) for approval on May 22, 2018.
Vietnam and Macau signed a DTA on April 16, according to a statement released by the Vietnamese Ministry of Finance on May 11, 2018.
Talks are continuing on a DTA between Jordan and Switzerland, according to a statement released by Jordan's Foreign Ministry on May 14, 2018.
The Czech Senate approved a law to ratify the DTA with Ghana on May 17, 2018.
The Philippines-Thailand DTA entered into force on March 5, and the Philippines' DTA with Sri Lanka on March 14, the Filipino tax agency announced on May 17, 2018. They will be effective from January 1, 2019.
Jordan's Minister of Planning and International Cooperation met with Luxembourg's Finance Minister to discuss enhanced cooperation between the two countries in a number of areas and agreed to seek to conclude a DTA.
Uzbekistan and Lithuania are to engage in talks towards a DTA, Uzbekistan's state news agency reported May 9, 2018.
Two Georgian committees approved the text of a DTA with Saudi Arabia and forwarded it for ratification, according to a May 17 announcement on the Georgian parliament's website.
Hong Kong gazetted an order to ratify its DTA with Saudi Arabia on May 18, 2018.
Talks are continuing on a DTA between Turkey and Afghanistan, according to a statement released by Turkey's Ministry of the Interior on May 11, 2018.
A new DTA between Finland and Spain will enter into force in January 2019, according to a May 18, 2018, announcement from the Finnish tax authority.
Andorra and Cyprus have signed a DTA, Andorra's Government announced on May 18, 2018.
Singapore and Brazil signed a DTA on May 7, 2018.
A DTA between Morocco and the Congo was signed on April 30, 2018.